Not much to write about. I had two stocks beat earnings estimates by 45% (PERI, NEXN) and both went down. Meanwhile stocks selling at what I think are ridiculous PE’s are all over the place. Even Walmart is selling at 40X earnings. Great company but it ain’t growing EPS at 40%. I did a day trade in ONDS last week and made 35% in a day. Another overvalued drone startup, but I had a gut feeling. I also bought a bunch of PRTS at $.75, since they are “highly confident” they will have deal either to sell the company or raise money. I am hoping for a sale. Otherwise just sitting and waiting.

I haven’t written in months. That’s because nothing much has changed. Tons of stocks selling at PE’s over 50 and small cap stocks are still shunned, even when they have good earnings or other good news. I was looking at Kratos (KTOS) today. Decent company in the defense industry. It is selling at about 70 times earnings. Now they may win a large drone contract, maybe. But also, maybe not. I have watched them for years and it is a “tush-push”, gaining 1 yard a year in earnings, but have now more than doubled over the last year. Just insane IMO.

The only stocks I have that are doing much of anything are PERI and NEXN which are in the ad-tech space–the new manufacturing in the U.S. NEXN is selling at about 10X 2025 earnings, growing EPS at about 20%, has no debt and about $2.50 a share in cash. PERI is selling at about 10X EPS, has about $8 a share in cash, no debt and looks like it will make about $1.00 EPS this year. Both are still cheap.

My other dogs remain. IRIX that sold stock at $2 a share recently and might get sold to TOPCON later this year (IMO). ARAY, EDAP, SNCR. I dumped SBH after earnings and made a few thousand.

I always look for new stocks to buy, but really am not finding anything that looks worth buying.

Sally Beauty-SBH-Made $1.69 for 2024, estimates for 2025-$1.83. Trading around $9 or 4.9X forward earnings.

Synchronoss-SNCR. Made $1.63 in 2024, $.94 in Q4 alone. Trading at about $10. 6X 2024 EPS.

NEXXAN-NEXN. Made $.93 for 2024. More next year. Has $2.75 in net cash. Trading around $8. Trading at 5.6X EPS, net of cash.

Perion-PERI. Has $8.08 per share in net cash. Expected to make about $1 a share in 2025. Trading around $8.65 and a PE net of cash of less then 1.

Value stocks are still being shunned and silly valuations abound. I still hold PERI which has $8.08 a share in cash and is making around $1 a share and is trading at $8.09. VNDA has $6.43 a share in cash, operating at breakeven, has a robust drug pipeline and is trading at $4.76 a share, ARAY had its best quarter in 3 years and after climbing to $2.95 a share is back below $2 at $1.99. The list goes on and on. I am really not buying anything new and am still trying to liquidate my old holdings.

I own these:

PERI-$17

ANGI-$6

VNDA-$14

The markets continue to be dumb IMO. You have a stock like NEXN trading at 6.5 times 2024 earnings per ADR and a stock like PLTR trading at 70 times revenue and 350 times earnings. Who can make sense of this? I continue to buy value stocks according to my formula, but just not as much. I have bought ANGI (IAC looking to spin it off), PERI that is trading at 1X earnings (after deducting the value of its massive cash hoard from its market cap) and VNDA which has over $6 a share in cash, real products and a big pipeline of drugs. Nobody cares about these because they are not mentioned on Reddit!

This is my last regular update. I will likely continue to post interesting ideas from time to time.

I was up 6.4% last week.

I closed out CRNT–just before it jumped to $3.70 on Friday. I booked a 53% profit. You can’t lose taking a profit.

NEXN is finally moving and hit $10 this week, up 120% from when I bought it.

I am still waiting for IRIX to do SOMETHING.

Hopefully SNCR will announced their AT&T renewal shortly.

VNDA, ANGI and PERI all look very cheap to me.

EDAP and SNCR have been killing me. I am down to 0% gain for the year. I guess I got greedy on both.

I dumped DHX and took my lumps. It worked four times before, but not this time. Even their new CFO left. Lost 36%.

I dumped VNDA for a 7% gain. They have more cash than their market cap, but no one cares.

I dumped SBLK for a 6% loss.

I tried to get out of CRNT but was only able to sell some for a 55% gain. Good earnings, but it couldn’t hold much of its gains. Again, a crappy market for small caps.

NEXN had great earnings but the stock went down anyway, just stupid.

I will wait for whatever deal IRIX comes up with. Hopefully this will happen soon. They have taken over a year to do something. Now they say they are close.

I find 180 Degree Capital quarterly shareholder letters interesting regarding their perspective on small caps and value stocks.

https://d1io3yog0oux5.cloudfront.net/_1e1471301fd36c83d1e2f17ecb7f3de9/180degreecapital/db/373/2906/letter_to_shareholders/Q3+2024+shareholder+letter+-+FINAL.pdf

More earnings reports this week:

NXXN-$15.02 up from $14.06

SNCR-$20.34 up from $19.68

IRIX-$3.79 down from $4.25, still waiting for the long promised “transaction”

CRNT-$5.15 up from $4.60

SCOR-$47.06 up from $41.68

I am in the process of liquidating all of my CSI stock positions. I sold a bunch last week. 

I am obviously out of tune with this market. Value stocks are being shunned for stocks trading at PE’s of 20 and up. PE’s of 50 and more are common. Either this is finally the “new economy baby” like they were touting back in 1999, or this is the biggest bubble I have seen in my 50 years of being in the market fueled by reckless government spending and total disregard for any risk in the market or economy. So I am folding up my tent and will stop posting any regular updates after next week. I ended up with an 85% win rate since 2015. I am 72 now and will just be mostly buying CD’s! Good luck to all of you in your investing.